Note 18 – Liquidity Agreement for Purchase of Investor Webcast

On April 20, 2015, the Company entered into a liquidity agreement to acquire 100% of CAST valued at $469,611 in exchange for 4,696 to-be-created Series B convertible preferred shares of Mentor.  The purchase price is based on projected future earnings of CAST and discounted at 17.87% (the discount rate used for the 2015 investment in installment receivable described in Note 5).

After one year, the to-be-created Series B convertible preferred shares may be converted, in steps or in whole, into Mentor common shares.  The to-be-created Series B convertible preferred shares will convert to common shares based on the following conversion formula:  ((3.3 times CAST recurring revenue) + (20 times CAST after tax profit) divided by 2) plus cash minus liabilities, for the preceding four calendar quarters, as defined in the agreement.  Due to Mentor’s recent reincorporation in Delaware, the series B convertible preferred shares have not yet been created.  Therefore, a convertible security has been issued to the prior owner of CAST which will be converted to Mentor Series B convertible preferred shares once they are created.

Actual operating results of CAST in future periods and the share price of Mentor common shares at the date of conversion will determine the number of common shares issued upon conversion of the Series B convertible preferred shares, in whole or in part.  The conversion formula will be evaluated in subsequent periods to determine if actual CAST operations result in a contingent asset or liability relating to the Series B convertible preferred shares.

Purchase price allocation of WCI assets and liabilities: